Good morning and welcome to the ADM fourth quarter 2021 earnings conference call. All lines have been placed on a listen-only mode to prevent background noise. As a reminder, this call is being recorded. I would now like to introduce your host for today's call, Vikram Luthar, Senior Vice President, Head of Investor Relations, Chief Financial Officer - Nutrition for ADM. Mr. Luthar, you may begin.

Thank you Rika. Good morning and welcome to ADM's fourth quarter earnings webcast. Starting tomorrow, a replay of today's webcast will be available at adm.com. For those following the presentation, please turn to Slide 2, the company's Safe Harbor statement which says that some of our comments and materials constitute forward-looking statements that reflect management's current views and estimates of future economic circumstances, industry conditions, company performance and financial results. These statements and materials are based on many assumptions and factors that are subject to risks and uncertainties. ADM has provided additional information in its reports on file with the SEC concerning assumptions and factors that could cause actual results to differ materially from those in this presentation, and you should carefully review the assumptions and factors in our SEC reports. To the extent permitted under applicable law, ADM assumes no obligation to update any forward-looking statements as a result of new information or future events. On today's webcast, our Chairman and Chief Executive Officer, Juan Luciano will provide an overview of the quarter and the year. Our Chief Financial Officer, Ray Young will review the drivers of our performance as well as corporate results and financial highlights, then Juan will discuss our outlook, after which they will take your questions. Please turn to Slide 3. I will now turn the call over to Juan.

Thank you Vikram. Our team delivered a superb fourth quarter. This morning, we reported record fourth quarter adjusted earnings per share of $1.50. Adjusted segment operating profit was $1.4 billion, 23% higher than the fourth quarter of 2020. Our trailing four quarter adjusted EBITDA was $4.9 billion, $1.25 billion more than a year ago, and our trailing fourth quarter average adjusted ROIC was 10%, meeting our objectives. Slide 4 please. That performance represented a strong finish to an astounding 2021. For the full year, our adjusted EPS was $5.19, also a record, and full year adjusted segment operating profit was $4.8 billion. This excellent performance was reflected across the company. Our team’s actions to improve their business portfolio and strengthen their operating model continue to enable superior performance in a strong market environment. AS&O delivered full year 2021 OP of $2.8 billion with each sub-segment performing at or near historic highs. Carbohydrate solutions executed phenomenally well to deliver full year operating profits of $1.3 billion, including revenue from the sale of our Peoria grain dry mill and the announcement of the sustainable aviation fuel MoU through our agreement with partners and the continuous growth of our exciting value solutions platform which delivered new revenue opportunities with an annualized run rate of almost $100 billion. We also continued to enhance our nutrition business with strategic investments targeted at growing areas of demand, including soy protein which will expand our participation in alternative proteins; PetDine, which substantially enhanced our presence in pet food and treats; Deerland, which continued the expansion of our functional probiotics and enzymes portfolio within our global health and wellness business; and FISA, which enhanced our flavor footprint by opening up new growth opportunities in Latin America and the Caribbean. Slide 5 please. Last month at our global investor day, we unveiled our strategic plan and reiterated our balanced financial framework for value creation, including using our strong cash flows to deliver both growth investments and distributions to shareholders. We are confident in our plan and committed to continue to deliver value for our shareholders, which is why we are pleased to announce an 8% increase in our quarterly dividend to $0.40 per share. We are proud of our record of 90 uninterrupted years of dividends and more than 40 years of consecutive annual dividend increases, and we are pleased to continue to follow through on our commitment to shareholder value creation. It has been a great year and we are excited about what is to come. Our continuous actions to build a better ADM and dynamically align it with the global trends of food security, health and wellbeing and sustainability and the steadfast advancement of our productivity and innovation initiatives will help propel our 2022 results. I will talk in more detail about the upcoming calendar year shortly, but first I’d like to turn the call over to Ray to review our business performance.

Yes, thanks Juan. Good morning and good afternoon everyone. Slide 6 please. The ag services and oilseeds team capped off really a truly impressive year, successfully navigating through supply chain challenges to deliver results largely in line with the extremely strong prior year quarter. The ag services team performed well in an environment of continued strong global demand, including significantly increased export volumes for customers outside of China. Global trade was substantially higher year over year, driven by solid risk management and improved results in global ocean freight. Overall, ag services delivered strong results just slightly off the outstanding fourth quarter of 2020, when we benefited from exceptionally high export margins. Crushing executed well in a continued solid demand environment for both soybean meal and vegetable oil. Lower results in EMEA versus a very strong fourth quarter of 2020 and approximately $250 million in net negative timing impacts versus negative $125 million in the prior year quarter drove overall results lower year over year. The majority of those negative timing effects are expected to reverse in the first half of 2022. The refined products and other team delivered substantially higher results versus the prior year period, driven by strong volumes and margins in North America for refined oils and improved biodiesel margins in North America and EMEA, which more than offset weaker South American results due to the reduced biodiesel mandate. Equity earnings from Wilmar were higher year over year. Looking ahead, we expect a strong first quarter from ag services and oilseeds, higher than the first quarter of 2021 and in line with the just ended fourth quarter. Slide 7 please. Carbohydrate solutions' fourth quarter results were more than double the prior year quarter. In starches and sweeteners sub-segment, including ethanol production from our wet mills, results were lower versus the fourth quarter of 2020 driven by higher input costs, including energy costs in EMEA as well as lower wheat milling volumes, partially offset by continued strong ethanol margins. Volumes for North American sweeteners and starches were largely flat year over year. Vantage corn processor results were again substantially higher year over year, driven by historically strong industry ethanol margins as a result of strong demand relative to supply, as well as increased sales volumes due to production at the two dry mills that were idle in the previous year period. As we look ahead, we believe the first quarter for carbohydrate solutions should be similar to or slightly above the strong first quarter of 2021. Slide 8 please. The nutrition business closed out a year of consistent and strong growth with fourth quarter revenues 19% higher year over year, 21% on a constant currency basis with 26% higher profits year over year and sustained strong EBITDA margins. Human nutrition had a great fourth quarter with revenue growth of 21% on a constant currency basis and substantially higher profits. Flavors continued its growth trajectory driven primarily by improved product mix in EMEA and continued strong performance from North America, partially offset by weaker APAC results. In specialty ingredients, overall profits for the fourth quarter were in line with the year ago period as strong demand for plant-based proteins offset the impact of one-time insurance proceeds in the fourth quarter of 2020. Health and wellness was higher versus the prior year quarter as the business continued to deliver growing profits in bioactives and fermentation. Animal nutrition revenue was up 21% on a constant currency basis and operating profit was much higher year over year, driven primarily by continued strength in amino acids. Now looking ahead, we expect nutrition to continue to grow operating profits at a 15%-plus rate for calendar year 2022 with the first quarter similar to the first quarter of 2021, with continued revenue growth offset by some higher costs upfront in the year and the absence of the one-time benefits we saw in the first quarter of the prior year. Slide 9 please. Now let me finish up with a few observations from the other segment, as well as some of the corporate line items. Other business results were substantially higher, driven primarily by higher captive insurance underwriting results as the prior year quarter included larger intra-company insurance settlements. For calendar year 2022, we expect other business results to be similar to 2021, although for the first quarter we expect a loss of about $25 million due to insurance settlements currently planned. Net interest expense increased year over year on higher short term borrowings. In the corporate line, unallocated corporate costs of $276 million were lower year over year due primarily to increased variable performance related compensation expense accruals in the prior year, partially offset by higher IT operating and project-related costs and transfers of costs from business segments into centralized centers of excellence in supply chain and operations. We anticipate calendar year 2022 total corporate costs, including net interest, corporate unallocated, and other corporate to be in line with the $1.2 billion area, consistent with what I discussed at global investor day, with net interest roughly similar, corporate unallocated a bit higher, and corporate other a bit lower. The effective tax rate for the fourth quarter of 2021 was approximately 21% compared to 8% in the prior year. The calendar year 2021 effective tax rate was approximately 17%, up from 5% in 2020. The increase for the calendar year was due primarily to changes in geographic mix of earnings and current year discrete tax items, primarily valuation allowance and return to provision adjustments. Looking ahead, we're expecting full year 2022 effective tax rate to be in the range of 16% to 19%. Our balance sheet remains solid with a net debt to total capital ratio of about 28% and available liquidity of about $9 billion. With that, let me turn it back to Juan.

Thank you Ray. Slide 10 please. I hope most of you were able to join us on our global investor day last month. There, we showed that we have consistently advanced our strategy, from our work to improve ROIC through capital cost and cash to our strategic growth and margin enhancement accomplishments, including the creation of a global nutrition business, to today’s focus on productivity and innovation. Thanks to this work, we are moving into 2022 with a better ADM, a more returns-focused organization with higher margins and less volatile earnings, and a portfolio that is well positioned to capitalize on the positive structural changes being driven by the enduring global trends of food security, health and wellbeing, and sustainability. Slide 11 please. Let me take a few moments to talk about how we see the 2022 environment. In ag services and oilseeds, we see a continued favorable global demand environment. Due to a short drought in South America with the magnitude of the shortfall still to be determined, we expect global ag commodity buyers will rely relatively more on the U.S. market for their needs, assuming we have a normal U.S. crop later this year. On the oilseeds side, we are starting 2022 with strong soy crush margins, and as we discussed at global investor day, we believe that increasing demand for meal as well as vegetable oil as a feedstock for renewable green diesel should continue to support the positive environment this year with our soy crush margins in the range of $45 to $55 per metric ton. Assuming these dynamics play out, we believe that ag services and oilseeds in 2022 has the potential to deliver an operating profit similar to or better than 2021. For carbohydrate solutions, we are assuming the demand and margin environment for our starch and sweetener products will be steady versus 2021. We expect the industry ethanol environment to continue to be constructive, supported by the recovery of domestic demand to pre-COVID levels, energy costs driving higher exports, and better clarity on the regulatory landscape. With this in mind, we are assuming higher ADM ethanol volumes and EBITDA margins to average $0.15 to $0.25 for the calendar year. In addition, we are expecting our value solutions platform to deliver another year of solid growth as we continue to evolve the carbohydrate solutions business. Putting it all together, we expect carbohydrate solutions to deliver full year operating profits slightly lower than the outstanding 2021. In nutrition, we are expecting continued growth in demand for our unparalleled portfolio of nutrition ingredients and systems, along with the benefits of accretion from our recent acquisitions. With these dynamics, we expect 15%-plus OP growth in 2022, revenue growth above 10%, and EBITDA margins above 20% in human nutrition and high single digits in animal nutrition, consistent with targets we set out at our global investor day. Slide 12 please. As we look forward in 2022, we see a positive demand environment across our portfolio, and then we add to that things we can do better. Our execution was great in 2021, but we’re always identifying opportunities for improvement and we intend to do even more to meet this growing demand in 2022. Put it all together and we’re optimistic for another very strong performance in 2022 as we progress towards our strategic plan next earnings milestones of $6 to $7 per share. With that, Operator, please open the line for questions.

Our first question on the phone lines comes from Ben Theurer of Barclays. Ben, please go ahead.

Thank you very much, and good morning, Juan, Ray. Congrats on those very strong results.

Thank you Ben.

Thank you Ben.

To start off, maybe just to stay a little bit within the outlook, clearly you continue to have a very positive view on the segment side, but could you also share a little bit your assumptions in terms of CapEx needs and where you’re seeing investment needs to be put into in order to deliver on the actual supply of these, so a little bit of your CapEx program and how you feel about that then ultimately the results flowing down to net income and what your expectations are for 2022?

There were several questions in your one, Ben, and you did well to ask them. From a CapEx perspective, looking at our strategic plan, most of it is driven by organic growth and productivity. To support that, we will increase our CapEx this year to about $1.3 billion. This will cover some expansion projects like the Spiritwood joint venture with Marathon, along with productivity enhancements to ensure we meet growing demand. We are entering 2022 with strong momentum, having finished 2021 on a high note, and we foresee a robust year ahead. As I mentioned, our ag services and oilseeds segments are performing very well, and we believe this year will be as good as or even better than last year. Carb solutions are also showing strong results with a stable start, and while there is always some uncertainty in ethanol, the environment looks favorable. Our value solutions are continuing to grow as they did last year, and we are seeing about 15% growth in operating profit for nutrition with double-digit revenue growth. Overall, we feel confident about the aspects we can control.

Okay, perfect. Thank you very much. Then just one last question, just a quick one. If you think about your medium term targets, and I remember you’ve laid out obviously as well the initiatives for share buybacks, etc., but in light of the higher CapEx plus the increase in dividends, fair to assume that share buybacks, at least in the short term, aren’t going to be a priority yet, correct?

Yes, I think the priority for capital allocation is to de-leverage after we had maybe a couple of billion dollars invested in acquisitions, certainly fund the projects that we have in higher CapEx, as I described, and then the dividend, to support the dividend. Of course, cash flow generation is strong in ADM, you know we focus a lot on that, so as cash flow becomes available, we’re going to think again in the five-year plan to have more buybacks in the later period, but if cash flow continues to be as strong, we may anticipate that a little bit. At this point in time, we don’t expect significant M&A as part of our plans, so that would be the capital allocation decision.

Perfect Juan, very clear. Thank you very much, and congrats again.

Thank you Ben.

Thank you Ben. We now have the next question from Ben Bienvenu of Stephens. Ben, please go ahead, your line is open.

Hey, thanks. Good morning and congrats on the strong quarter.

Thank you Ben.

I wanted to follow up on the outlook commentary, which was really helpful and detailed. Of particular interest to us is the bio-product commentary that you offered. I think within the carbohydrate solutions business, the commentary around starches and sweeteners makes sense. The bio-products obviously benefited from a very strong fourth quarter, and I suspect perhaps you had an opportunity to secure margins into the first quarter, but the commentary is pretty positive through the balance of the year, and I realize higher production will help in benefiting operating profit for that business. Can you talk a little bit about what informs your view for the strength of the ethanol business sustaining into 2022?

Good morning, Ben. This is Ray. We had a very strong finish in our bio-products business, particularly in ethanol. The demand environment in the fourth quarter was very positive, reflecting the recovery in driving miles in the U.S. during the holiday season. Strong gasoline demand translated into robust ethanol demand. On the supply side, the industry faced supply challenges, which contributed to a strong market; in fact, our EBITDA margins for ethanol in the fourth quarter were above a dollar per gallon, historically quite strong. Looking ahead to 2022, we remain optimistic about ethanol. While inventories have increased a bit in January due to seasonal factors, we see a few reasons for optimism. First, we expect strong domestic demand for ethanol, with growth from 2021 to 2022, potentially returning to pre-pandemic demand levels in the U.S., around 14 billion gallons. Second, we anticipate a global recovery in gasoline demand, which will drive ethanol demand. With rising crude oil prices, ethanol is becoming increasingly attractive, and we expect export demand for ethanol to recover to 1.4 to 1.5 billion gallons in 2022. Third, we believe the regulatory landscape regarding small refinery exemptions has clarified and will not impact supply-demand balances. We see a positive outlook in which the required 15 billion gallons needs to be delivered to the market, along with a remanded requirement of about 250 million gallons moving forward. Considering that we are starting the year with a balanced supply-demand perspective for U.S. ethanol inventories, a constructive demand environment compared to 2021, and a supportive regulatory framework, we have a positive outlook. As Juan mentioned, we’re assuming EBITDA margins of $0.15 to $0.25 per gallon for 2022, which is lower than our assumption for 2021. We might be taking a conservative approach at this time, but we believe the environment will be favorable as we progress through 2022.

Thank you, Ray, that was very helpful. My second question is about the global operating environment, specifically the situation in Ukraine and the ongoing tensions there. How is this situation affecting your business today? I know you don’t have significant exposure in that region, but since Ukraine is a major producer of rapeseed, corn, wheat, and barley, I’m interested in hearing about the market impact you're currently observing and your outlook for 2022, considering the various scenarios that could unfold.

Yes Ben, of course you realize the supply of many commodities remains at their tightest levels in years, so I think any news around the world of disruption, whether it’s weather or geopolitics is going to prolong the high prices well into, probably, 2023. As you described, at this point in time there are three things. We are all looking at the development of the crops in South America as they need to go through February rains, especially in Argentina and the harvest in Brazil. We are looking of course at geopolitical conflicts like the one you described, and also the expectations of the crop in the U.S., all this in the middle of a very strong demand. As you said, Ukraine is a big exporter, especially if you think about corn and the ability to supply China’s needs. You have the three main suppliers, whether it’s the U.S. and you have Ukraine and you have Brazil, so hopefully Brazil with these rains will have a safrinha crop that is maybe a little bit better than what we expect, but among these three countries need to cover the supply of corn, and corn today is one of the best sources of energy and fat out there, one of the cheapest ones, so it’s a very demanded product, so we’re all paying attention to what happens.

Okay, thank you Juan. Congrats on the quarter, and best of luck into 2022.

Thank you Ben. Thank you very much.

Thank you. We now have another question on the phone lines from Adam Samuelson of Goldman Sachs. Adam, please go ahead when you’re ready.

Yes, thank you, and good morning everyone.

Morning Adam.

I would like to revisit the outlook for carbohydrate solutions and ensure I understand the various components affecting the full-year 2022 outlook, which is projected to be slightly below 2021. Both your performance in 2021 and 2022 exceeded expectations, and I want to consider the factors at play regarding ethanol. Could you clarify whether the ethanol margin of $0.15 to $0.25 a gallon EBITDA refers solely to the dry mill gallons from Vantage corn processors, or does it also include the wet mill? Additionally, I'm curious about the fourth quarter performance. Given the favorable ethanol margins, I was surprised to see that the starches and sweeteners business declined, especially since it should benefit from a strong U.S. ethanol environment. Please help us understand the connections between these elements within the segment that contribute to the 2022 outlook.

Yes Adam, it’s Ray here. The $0.15 to $0.25 EBITDA margin reflects the total for both wet and dry mill ethanol, based on a combined assumption. In the fourth quarter, we had an outstanding performance. VCP benefited significantly from the ethanol margins, and both starches and sweeteners also gained from the ethanol side of the business. Our net corn cost was a bit higher in the fourth quarter for starches and sweeteners. When we hedged corn for 2021, we secured an attractive position in 2020 for many of our needs, though not all, which left us more exposed to net corn costs in the fourth quarter. As a result, the higher corn costs led to slightly lower margins on the sweeteners side. We also faced some operational challenges with the startup of our facility in Bulgaria, which presents an opportunity for us in 2022. Additionally, energy costs in Europe rose, especially due to significant increases in natural gas prices late in the year, affecting our starches and sweeteners segment. There were various factors impacting the fourth quarter, but we believe many of these issues will be resolved, as we have established a solid hedge position for 2022, and we have addressed several concerns with the Bulgarian project, which should positively impact us in the coming year.

That information is very useful. I would like to shift focus to the nutrition segment and discuss our expectations for the business on an organic level in 2022. Considering the mergers and acquisitions in the second half of 2021, you mentioned projections of over 10% revenue growth and more than 15% profit growth. Could you clarify the contributions from M&A in those projections, as well as any specific areas of the business where you are more optimistic than the segment average, and those where growth may fall short?

Yes, so I think most of 2022 will be on an organic growth basis, if you will. The contribution still of the acquisitions is going to happen a little bit later. These acquisitions are not made, to be honest, for the accretion of 2022. As you recall, we are just building the nutrition business, so this is the strategic importance of positioning ourselves in the areas where we’ve been informing you. I think that we always like to have the policy of no surprises, and I think you heard me saying health and wellness is an area where we were going to invest, and that’s why we did Deerland pet food, and that’s why we did PetDine. We continue to think about the incredible potential of plant-based proteins, and that’s why we did soy protein which is making us more international. I talked about how powerful we are in flavors, but we were under-represented, if you will, in the emerging markets, and that’s why we invested in capacity in Pinghu for flavors in China, and we also acquired Fisa that gives us a beachhead into Central America, Caribbean, and maybe the northern part of Latin America. When we look at the business, our confidence in the 15%-plus organic operating profit growth is given by our pipeline and our win rates, to be honest, that’s why we look. Our pipeline continues to increase, our product launches continue to increase and actually accelerate, and our win rates have almost doubled from one year to the other, so the business is operating very well. We guided flat for Q1 just because of the way some of the costs fall, and they are more front-loaded into next year, but this is a business again that’s been growing 34%, 20%, I think we’re going to stabilize in the long term at this rate of 15%, 15%-plus with double digit organic growth, basically, without even touching the M&A for that growth.

Got it. That’s all really helpful. I’ll pass it on, thank you.

Thank you Adam.

Thank you. We now have a question from Robert Moskow of Credit Suisse. Robert, I’ve opened your line.

Hi, thanks for the question, and congrats on a great year.

Thanks Robert.

Of course. Maybe you’ve kind of implied this already, but your pricing for corn sweeteners in 2022, can you describe how the negotiations went, and it looks like what you’re guiding to was kind of flattish profits in North America for corn sweeteners as a result of that pricing. Is that a fair assessment?

Yes Rob, our objective is really to maintain margins, and so through the course of the negotiations, I think it’s fair to make an assumption that we’ve been able to maintain margins and offset the higher corn costs that has occurred recently. I think we’ve achieved that objective, and that’s a fair assumption to assume as we go into 2022.

Okay, and maybe a follow-up. If the growth of refined soybean oil is driven by the increasing demand for renewable biodiesel, have you been monitoring the industry's planned expansions for those refineries? Is the capacity coming online as anticipated, and is it producing the demand for oil that you were expecting?

Yes, we are closely monitoring the situation. At this time, demand continues to exceed even the announced capacity expansions. However, we must acknowledge that, given the current supply shortages and labor challenges, executing projects is not straightforward. When considering a significant number of announcements, it seems reasonable to expect that some portion of them will materialize, either in reality or on a longer timeline. We typically view this with a long-term perspective, estimating that about two-thirds to 75% of these plans will come to fruition. Currently, we are observing increased volume, and it's important to recall that the original issue with oil was driven by high palm oil prices globally, which also raised prices for soybean and other oils. Additionally, there is now a growing demand for RGD, creating a strong convergence of raw materials to meet the oil supply. So, yes, we are monitoring this closely, and everything is progressing as anticipated.

Okay, all right. Thank you.

You're welcome.

Thank you Robert. We now have Tom Palmer of JP Morgan. Tom, your line is open, please go ahead.

Good morning. Thank you for the questions, and congratulations on the quarter.

Thank you Tom.

Maybe I can follow up on Rob’s question, just on the refined products outlook, and maybe a little more specific on how you’re thinking about the set-up for 2022. We do have maybe the first larger wave of facilities coming online with pre-treatment units, although that is at least back half-weighted, I think, so maybe what’s the assumption for refined products this year, and do you think that that addition in terms of capacity is going to have much impact, or as you were kind of noting with Rob, maybe just with timing and needs of still sourcing from, at least a portion from third parties, it won’t be as impactful?

Yes, Tom, we still believe we can add around a billion gallons per year of additional RGD capacity, aiming to reach a total of about 5 billion gallons by 2025. As I mentioned to Rob, we constantly reevaluate the announced capacity and examine market conditions, leading us to consider various scenarios. We think these capacities are crucial to meet the anticipated demand growth for both vegetable oil and global meal needs. Currently, vegetable oil consumption is outpacing supply. We've received some positive news about Sanoil availability from black seed, which may alleviate some pressure on bean oil availability. Regarding the pre-treatment comments, vegetable oil will ultimately be needed as a feedstock, and pricing will reflect the value of this feedstock, likely influenced by carbon intensity. This could result in fluctuations in value between crude oil and refining. It's important to recognize that we are in the early stages of this industry's development, and we will see shifts in value being captured in different ways. However, we are well-positioned since our biodiesel plants are fully integrated into refineries, and we are closely monitoring developments and feel optimistic about how things are progressing.

Great, thank you for that. Maybe I’ll segue with that to the crushing side. It seems like you’re starting off the year with quite strong soy crush margins, perhaps higher than maybe you’re guiding to for the year. Is there a, I guess, catalyst or driver that maybe makes margins weaker? Is there a bit of conservatism embedded? We see headlines around lysine shortage - is that something you’re expecting to resolve itself and maybe see still a very favorable crush environment, but a little more normalized versus to start off the year?

Yes, there are numerous factors at play in this large industry. Looking at demand, the forecast for poultry production in 2022 is set to be a record, and beef and hog production is expected to be near record levels as well. This indicates that protein demand continues to rise globally, which supports the market. The current tightness in meat proteins and synthetic amino acids is benefiting soybean meal. It's important to note that fat and energy prices are quite high right now, making corn the least expensive carbohydrate option, which is driving soybean meal exports to Russia. We anticipate that the lysine market may stabilize later in 2022. Additionally, soy meal dynamics are changing, with U.S. soybean meal becoming more competitive in export markets, especially considering Argentina may have a less favorable soybean crop this year. This situation is likely to positively influence crush margins in North America and Europe.

Thank you.

Thank you Tom.

We now have the next question from Vincent Andrews from Morgan Stanley. Vincent, please ensure your line is unmuted locally, and you may go ahead.

Hi, this is Steve Haynes on for Vincent. Wanted to ask a question on the bio-solutions business and the $100 million of annualized revenue wins in 2021, and if you could maybe just provide some more color on specific end markets where you’re getting those wins and then how to think about the size of that going forward.

Yes, thank you for the question, Steve. Listen, we are very excited about how that business is developing. I think we recognized in the past that that business happened almost while we were not watching and it was a customer pull more than our push. Now, we have a segment approach to that. We have intentionality in developing that market and as such, the opportunities have flourished. I would say a strong contribution from packaging, a strong contribution from fermentation - you know, we’re helping other people that are creating some of these materials out of a plant base, personal and homecare, a very important segment that is growing, and a growing contribution from pharma, construction and plant treatment. So as you can tell, as we continue to deploy marketing resources into some of these segments, we continue to have success. There are some segments that are more developed and larger for us and some segments that are more incipient, but I think it’s going very well. We are working on the product mix as sometimes the growth is faster than our capacity, so we’re trying to accommodate that and we’re going to be having more capacity coming up soon to be able to sustain this 10% growth rate that we have.

Thank you.

You're welcome.

Thank you Vincent. We now have Ken Zaslow of BMO Capital Markets. Ken, please go ahead when you’re ready.

Hi, good morning everyone.

Morning Ken.

Hey Ken.

Let me take a different approach. While you mentioned various factors impacting demand, during your analyst day, you also addressed the rising cost structure and potential headwinds. Looking ahead, these headwinds don’t appear to be emerging as significantly as anticipated. Can you elaborate on your comments from the analyst day and share your current perspective on these headwinds as we move through 2022? Are they developing as you had predicted, or are they less impactful than expected?

Yes, Ken, the dynamics here involve our forecasts accounting for a potential decline in margins and some inflation, which is challenging to time accurately. We also anticipate that productivity and innovation will increase their impact as these projects progress. On the negative side, we've prepared several scenarios and the most significant issue currently is energy inflation, along with inflation in some smaller products. We are experiencing supply chain disruptions and labor shortages, which are common across many companies. From an energy perspective, the impact is more pronounced in Europe, affecting both our crush and carb solutions. Our team is actively working on improving energy efficiency to mitigate some of this increase, along with using our hedging strategies. Regarding raw materials and supply chain issues, this primarily affects our nutrition segment, which has a wider variety of raw materials and SKUs, making it more susceptible to these challenges. Thus, we're primarily focused on the European energy increases and the occasional supply chain issues in nutrition.

My second question is regarding China. In previous calls, you mentioned how demand is increasing. Considering that 2021 was an exceptional year for demand in China, how do you foresee this playing out in 2022 and 2023? Will there be a change in the mix, or is increased demand expected? How does this relate to your business model? Thank you for your time, as always.

Yes, thank you Ken. Listen, we think that China has recovered from the ASF, they recovered their herd. You saw the dynamics in terms of pork prices coming up and down. We still believe that they will import soybeans in the high 90s - you know, 96, 97 million give or take, and around probably 25 million tons of corn. Again, when we are working the way they are managing through COVID challenges, but we expect demand will continue to grow, it continues to be supported by improved diets and professional feeding practices. Even if we see some moderation of GDP, we think that we’ve seen per capita consumption of the top four meats basically increases, and even if they correct it a little bit, they correct versus 2021, they are still much bigger than pre-ASF and pre-pandemic. We guided a number here or there, but still it’s going to be very strong, and as I said, probably 96, 97 million of soybeans, 25 million of corn, that will provide a good base for the grain industry and the crushing industry.

Great, I appreciate it. Thank you guys.

Thank you Ken.

We now have a question from Ben Kallo from Baird. Ben, please go ahead when you’re ready.

Hi, good morning everyone, and thanks for taking my questions. Ray, you touched on the regulatory environment just in your ethanol comments, but maybe just on a broader level, maybe around renewable diesel, if you guys could talk about that. Then on the legislative front, I hate to ask because it’s anyone’s best guess, but how you see maybe the blender’s tax credit and anything around aviation fuel evolving. Thank you.

Yes, on the biodiesel, as you know, the current blender’s credit continues until the end of 2022 - December 31, 2022, so naturally we’re looking at what’s happening on the legislative agenda in Washington on the BBB program to see whether it gets renewed. But historically what you’ve seen is, frankly, both parties are supportive of the biodiesel industry - it’s important for the United States, and so even if something doesn’t occur on BBB, we’re optimistic that the blender’s credit will get extended in one way or another through some form of legislation as we move through the year. If you recall, sometimes it happens after you get through the end of the year and then you have a retroactive biodiesel tax credit, which we’ve seen in the past, so we actually feel confident that something will occur there in order to kind of continue with the blender’s credit on the biodiesel tax credit. On the SAF front, as you know, this is something that we’re working on right now with different partners. It is going to be an important part of the fuel industry in the future as we go green in terms of aviation fuel, so we’re optimistic that some form of legislative actions will be taken to support the sustainable aviation fuel, the SAF industry. Again, it’s a nascent industry right now, right - very few gallons are being produced, but projections show that by 2030, there’s going to be a need for about 4 billion gallons of sustainable aviation fuel in combination of United States and Europe, so it’s a significant growth industry and probably there’s going to be some level of support required in order to start up this industry here.

And back to the renewable diesel front, could you just talk about any areas that you’re watching? We talked about the supply side and how you discount new production facilities coming online, but could you talk about the demand side and where you’re seeing incremental demand coming from, the regions that we already know out there or new regions? Thank you, and thanks for all of the answers.

The demand side is really driven by the different states implementing low carbon fuel standards, LCFS standards, particularly starting out in the west, but frankly it gets extended across all of the United States and Canada. The demand side is there as all the states move towards LCFS standards, and frankly the industry is just simply trying to respond to that demand by building the supply to meet that particular requirement there.

Thank you. We now have a question from Steve Byrne from Bank of America. Steve, please go ahead, I have opened your line.

Yes, thank you. Do you think that soybean oil will represent the majority of the feedstock for this 5 billion gallons of renewable diesel?

It’s going to represent an important part of it. As demand grows for renewable green diesel, it’s going to require the pull from many sorts of feedstocks, and in fact it’s very likely that even canola oil will find a pathway eventually to become part of a feedstock for renewable green diesel. But we still believe that maybe about 45% of the production will come from soybean oil, eventually small production out of the canola oil that I referenced there, so it is going to be an important component because there’s just insufficient amount of, let’s say, used cooking oil and other types of feedstocks, fat and rendering. There’s just not enough supply in order to meet this growing demand.

Even your 45% is 30 million acres of incremental soybeans, which I don’t think is going to happen. Does that mean soybean exports get squeezed out and instead it gets crushed, the oil goes into RD, and you export the meal?

We’ve indicated we believe that a lot of the U.S. soybean oil exports will actually come down, you’re correct. I think there is going to be a diversion away from exports of soybean oil. There will also be some diversion away from even food applications. There's going to be a daisy chain effect that goes on which, frankly, is actually supportive for the entire vegetable oil complex around the world. I think there is going to be some daisy chain effects that are going on in order to meet this type of demand.

And then what about your Slide 15, where you show forward sales by farmers in South America being below historical averages? Do you attribute that to the uncertainty that they are seeing with their current crop, just from either drought or excessive rain, and if grain and oilseed production is lower there in 2022, or the rest of the world for that matter, is that a net benefit to you in trading?

Steve, this is Juan. What you’re seeing from the farmer in South America is reflective of both things. One is the current impact in South America, and the second is, as you see, they are looking at what happened with the size of the crop. In terms of whether it’s beneficial for ADM or not, our role is to try to fulfill our mission of providing nutrition around the world, and that’s where we use our supply chain to make sure that we deliver to our customers and we deliver to the populations around the world. Sometimes it coincides with margin expansion in some parts of the business, sometimes it may not. We like the fact that there is strong demand around the world, and that tends to be good for ADM, yes.

Thank you.

You’re welcome.

Thank you. We now have our next question from Michael Piken of Cleveland Research. Michael, please go ahead.

Yes, good morning. Just wanted to sort of get your take on the current transportation system and the outlook it supports, both in New Orleans, are we fully recovered from the hurricanes, and then kind of the barge system and what’s happening over in the ports in China. What’s sort of the back-up, and is business flowing normally or how backed up is it?

Yes, Michael, that's a good question. Let’s discuss China. There are some minor COVID-related challenges affecting the ports, but honestly, the situation has improved. We initially received reports on the issue, but overall, the port conditions are getting better, and we're currently averaging about two to three days of waiting for bulk agricultural cargo at most major ports, so I would say things in China are fairly stable. In Brazil, however, we’ve observed an increase in line-ups and demurrage times. There are still ships exporting corn and importing fertilizers due to a slight delay in the soybean harvest. We're experiencing waiting times that have roughly doubled from about 15 days to 30 days in Brazil, which is shifting some of the volume to North America for deliveries around March-April. For the most part, North America's export capacity has rebounded. There is one plant scheduled for some medium-term repairs, but generally, the export capacity has recovered to levels seen before the idle periods, at least from our perspective. Regarding the Illinois River, there are significant freezing and icy conditions that have hindered river movement, and we anticipate that this will continue.

Great, that’s helpful. Then just as a follow-up, what’s the elevation margin outlook as you guys see it for the year? Thanks.

We’re noticing that, as you know, the impact of Ida in Q4 affected our ability to supply despite the demand, leading to a lot of that volume being pushed into Q1. We've observed that elevation margins have increased in Q1, which aligns with our expectations, so we are optimistic about meeting that demand.

Thank you.

You’re welcome.

Thank you. Our last question comes from Eric of Seaport Research Partners. Eric, please go ahead.

Yes, thank you. Thanks for squeezing me in everybody. Congrats on a great quarter. Great year everyone.

Thank you.

I understand that this topic has been discussed extensively and is crucial. Focusing on the renewable green diesel market, if we consider the feedstock needed to achieve your 2025 target of 5 billion gallons, it will require an increase equivalent to 30 million acres of soybean production, which is unrealistic. I know that Greg and Chris are addressing this issue. Given that this is a global market, doesn’t this align with a very positive long-term outlook for agricultural services? Meeting these demands will necessitate pulling significant resources from around the globe, which makes achieving these goals feasible. Is that the correct perspective?

Yes, I think Eric, when you have one explosion in demand in one place of the world, resources from around the world will come, and as Ray was saying, maybe we’re going to export less, certainly we may import more, and there are going to be shifts between the different products. I would say we continue to be in a world that requires more food and also that requires to help the environment. It has been a structural change in demand for us, and for a company that has assets around the world, that probably means better utilization of those assets and better value of those assets as we try to solve these issues.

Thank you. My final question, which many have been answered already, is about the current year’s U.S. crop production. What feedback are you receiving from your farmer clients? It seems we are making a push in the corn markets to increase corn production. Given the uncertainty with input costs and various factors, what is your perspective on the crop production outlook for this year, broken down by crop?

We expect a strong U.S. planting. Of course, some of those decisions, as you said, it’s getting the time to make those decisions, and a lot of people are looking at the South American weather. South American weather is very strange at the moment - there are very dry conditions in Parana or the south of Brazil, and maybe Argentina, and it was a little bit too wet in the north. Numbers in the north are coming strong in terms of yield for Brazil. I think that the recent rains have stopped the deterioration of the crop in Argentina and the south of Brazil, and probably with Paraguay having already felt the damage. We believe in the U.S. We still believe that probably corn will outpace soybeans in terms of acres, so we’d probably think about, I don’t know, something like 93 million acres of corn, 87 million acres of soybeans give or take. I understand the dynamics about fertilizers and all that, but I think even the prices of last year, I think that the prime land will probably maintain the same mix.

Yes, I would agree with you. Thank you Juan, and again congratulations on a great year.

Thank you. Thank you Eric.

Thank you. I would like to hand it back to Vikram Luthar for some closing remarks.

Thank you Rika. Thank you for joining us today. Slide 13 notes upcoming investor events in which we will be participating. As always, please feel free to follow up with me if you have any other questions. Have a great day and thanks for your time and interest in ADM.

Thank you everyone for joining. That does conclude today's call. You may disconnect your lines and have a lovely day.